Costco Wholesale Corp. has acquired a national logistics company, Innovel Solutions, for $1 billion, expanding the retailers e-commerce-delivery muscle as demand for those services continues to expand during the coronavirus era.
Innovel, prior to the sale to Issaquah-based Costco, operated as a subsidiary of Illinois-based Transform Heldco LLC, which operates Sears and Kmart stores. Costco had been a customer of Innovel since 2015. Under Costco’s ownership, Innovel will continue to serve Sears and Kmart as well as other third-party customers and also retain Innovel’s 1,500 employees, according to Transform Heldco.
“Innovel has for decades provided Sears and, more recently, third parties with ‘final mile’ delivery, complete installation and white-glove capabilities for ‘big and bulky’ products across the United States and Puerto Rico,” Costco said in announcing the acquisition. “Innovel’s network offers coverage to nearly 90% of the U.S. and Puerto Rico.”
Products delivered and installed via Innovel include major appliances, furniture, mattresses, televisions, grills, patio, fitness equipment and wine cellars. It operates 11 distribution and fulfillment centers and operates in excess of 15 million square feet of warehouse space around the country.
“We have had a great relationship with Innovel and share a philosophy of taking care of our members,” says Craig Jelinek, chief executive officer of Costco “We believe the acquisition will allow us to grow our e-commerce sales of ‘big and bulky’ items at a faster rate.”
Costco operates 786 warehouse outlets, including 547 in the United States, It also operates e-commerce sites in the United States, Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan and Australia.